Korean won climbs 8% in July on chip earnings repatriation and hawkish policy tilt

South Korea’s won jumped nearly 8% in July, the second-best global performer after Colombia, as repatriation of overseas earnings by chipmakers, a tech stock sell-off, and a tighter policy stance supported the currency. Repatriation flows—estimates of about $1 billion per day mid-July to mid-August—along with Samsung and SK Hynix’s announced investments and a blockbuster US listing for SK Hynix, helped domestic demand for won. The Bank of Korea raised rates to 2.75%, with Q2 GDP at 3.7% and inflation at 3.2%, suggesting policy could continue to support the won even as the Kospi fell sharply on AI stock weakness. Foreign outflows moderated but remained net selling, underscoring a shift in flow dynamics that aided the won’s rebound.